EX-99.1 2 sptn-ex99_1.htm EX-99.1 EX-99.1

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Exhibit 99.1

 

 

FOR IMMEDIATE RELEASE

SpartanNash Announces Second Quarter Fiscal 2024 Results

Reaffirms Fiscal 2024 Guidance

Pilots Customer Value Proposition in Retail Segment

GRAND RAPIDS, Mich. – Aug. 15, 2024 – Food solutions company SpartanNash (the "Company") (Nasdaq: SPTN) today reported financial results for its 12-week second quarter ended July 13, 2024.

"The team’s execution of our transformational initiatives has created a foundation for future growth while contributing to our margin gains year-to-date," said SpartanNash President and CEO Tony Sarsam. "We are pleased with the progression of our investments in margin-enhancing programs and expect benefits by the end of the year. Building on this progress, we are piloting a Customer Value Proposition initiative that is informed by extensive shopper data and insights, aimed at enhancing freshness, value and convenience. As part of this store modernization program, we are lowering prices on 6,000 products to bring more value to our shoppers today."

Second Quarter Fiscal 2024 Highlights(1)

•
Net sales decreased 3.5% to $2.23 billion, driven by lower volumes in both the Wholesale and Retail segments.
o
Wholesale segment net sales decreased 4.8% to $1.55 billion primarily due to reduced volumes in the national accounts customer channel.
o
Retail segment net sales decreased 0.4% to $676.1 million, with comparable store sales down 2.5%. Incremental sales from newly acquired Metcalfe’s Market stores were offset by lower consumer demand trends.
•
Net earnings of $0.34 per diluted share, compared to $0.57 per diluted share.
o
The decrease was primarily due to lower unit volumes and higher restructuring and asset impairment charges. This reduction was partially offset by benefits from the merchandising transformation, favorable segment sales mix, as well as lower LIFO expense of $3.2 million.
•
Adjusted EPS(2) of $0.59, compared to $0.65. Adjusted EBITDA(3) of $64.5 million, compared to $66.1 million. These measures exclude, among other items, restructuring and asset impairment charges, the impact of the LIFO provision and acquisition and integration expenses.

Other Fiscal 2024 Highlights(4)

•
Cash generated from operating activities of $132.1 million compared to $49.7 million. The 166.0% increase in cash from operating activities is due primarily to ongoing working capital management initiatives.
•
Net long-term debt(5) to adjusted EBITDA(3) ratio of 2.2x improved sequentially compared to 2.4x at the end of the first quarter.
•
Capital expenditures and IT capital(6) of $73.4 million compared to $63.5 million.
•
Returned $30.4 million to shareholders through $15.1 million in share repurchases and $15.4 million in dividends.
(1)
All comparisons are for the second quarter of 2024 compared with the second quarter of 2023, unless otherwise noted.
(2)
A reconciliation of net earnings to adjusted earnings from continuing operations, as well as per diluted share (“adjusted EPS”), a non-GAAP financial measure, is provided in Table 3.
(3)
A reconciliation of net earnings to adjusted EBITDA, a non-GAAP financial measure, is provided in Table 2.
(4)
All comparisons are for the fiscal year-to-date 2024 compared with the fiscal year-to-date 2023, unless otherwise noted.
(5)
A reconciliation of long-term debt and finance lease obligations to net long-term debt, a non-GAAP financial measure, is provided in Table 4.
(6)
A reconciliation of purchases of property and equipment to capital expenditures and IT capital, a non-GAAP financial measure, is provided in Table 5.

Fiscal 2024 Outlook

Based on the Company’s performance to date and the current outlook for the remainder of fiscal 2024, the Company reaffirmed its previous guidance provided on May 30, 2024. The following table provides the Company’s guidance for fiscal 2024:

 

Fiscal 2023

 

 

Fiscal 2024 Outlook

 

(In millions, except adjusted EPS(2))

Actual

 

 

Low

 

 

High

 

Total net sales

$

 

9,729

 

 

$

 

9,500

 

 

$

 

9,700

 

Adjusted EBITDA(3)

$

 

257

 

 

$

 

255

 

 

$

 

270

 

Adjusted EPS(2)

$

 

2.18

 

 

$

 

1.85

 

 

$

 

2.10

 

Capital expenditures and IT capital(6)

$

 

127

 

 

$

 

135

 

 

$

 

145

 

 

 

 

Guidance incorporates the Company’s long-term strategic initiatives, including all transformational programs and tuck-in acquisitions.

Conference Call & Supplemental Earnings Presentation

The Company will host a conference call to discuss its quarterly results with additional comments and details on Thursday, Aug. 15, 2024, at 10:30 a.m. ET. There will also be a simultaneous, live webcast made available at SpartanNash's website at spartannash.com/webcasts under the "Investor Relations" section and will remain archived on the Company's website through Thursday, Aug. 29, 2024.

A supplemental quarterly earnings presentation will also be available on the Company’s website at spartannash.com/investor-presentations.

About SpartanNash

SpartanNash (Nasdaq: SPTN) is a food solutions company that delivers the ingredients for a better life. Committed to fostering a People First culture, the SpartanNash family of Associates is 17,000 strong. SpartanNash operates two complementary business segments – food wholesale and grocery retail. Its global supply chain network serves wholesale customers that include independent and chain grocers, national retail brands, e-commerce platforms, and U.S. military commissaries and exchanges. The Company distributes products for every aisle in the grocery store, from fresh produce to household goods to its OwnBrands, which include the Our Family® portfolio of products. On the retail side, SpartanNash operates 147 brick-and-mortar grocery stores, primarily under the banners of Family Fare, Martin’s Super Markets and D&W Fresh Market, in addition to dozens of pharmacies and fuel centers. Leveraging insights and solutions across its segments, SpartanNash offers a full suite of support services for independent grocers. For more information, visit spartannash.com.

Forward-Looking Statements

The matters discussed in this press release and in the Company's website-accessible conference calls with analysts and investor presentations include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended ("Exchange Act"), about the plans, strategies, objectives, goals or expectations of the Company. These forward-looking statements may be identifiable by words or phrases indicating that the Company or management "expects," "projects," "anticipates," "plans," "believes," "intends," or "estimates," or that a particular occurrence or event "may," "could," "should," "will" or "will likely" result, occur or be pursued or "continue" in the future, that the "outlook," "trend," "guidance" or "target" is toward a particular result or occurrence, that a development is an "opportunity," "priority," "strategy," "focus," that the Company is "positioned" for a particular result, or similarly stated expectations. Undue reliance should not be placed on these forward-looking statements, which speak only as of the date made. Forward-looking statements are necessarily based on estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies may affect actual results and could cause actual results to differ materially. These risks and uncertainties include the Company's ability to compete in an extremely competitive industry; the Company's dependence on certain major customers; the Company's ability to implement its growth strategy and transformation initiatives; the Company's ability to implement its growth strategy through acquisitions and successfully integrate acquired businesses; disruptions to the Company's information security network, including security breaches and cyber-attacks; impacts to the availability and performance of the Company's information technology systems; changes in relationships with the Company's vendor base; changes in product availability and product pricing from vendors; macroeconomic uncertainty, including rising inflation, potential economic recession, and increasing interest rates; difficulty attracting and retaining well-qualified Associates and effectively managing increased labor costs; failure to successfully retain or manage transitions with executive leaders and other key personnel; impacts to the Company's business and reputation due to an increasing focus on environmental, social and governance matters; customers to whom the Company extends credit or for whom the Company guarantees loans may fail to repay the Company; changes in the geopolitical conditions; disruptions associated with severe weather conditions and natural disasters, including effects from climate change; disruptions associated with disease outbreaks; the Company's ability to manage its private brand program for U.S. military commissaries, including the termination of the program or not achieving the desired results; impairment charges for goodwill or other long-lived assets; the Company's level of indebtedness; interest rate fluctuations; the Company's ability to service its debt and to comply with debt covenants; changes in government regulations; labor relations issues; changes in the military commissary system, including its supply chain, or in the level of governmental funding; product recalls and other product-related safety concerns; cost increases related to multi-employer pension plans; and other risks and uncertainties listed under "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's most recent Annual Report on Form 10-K and in subsequent filings with the Securities and Exchange Commission. Additional risks and uncertainties not currently known to the Company or that the Company currently believes are immaterial also may impair its business, operations, liquidity, financial condition and prospects. The Company undertakes no obligation to update or revise its forward-looking statements to reflect developments that occur or information obtained after the date of this press release.

# # #

 

 

 

INVESTOR CONTACT:

Kayleigh Campbell

Head of Investor Relations

kayleigh.campbell@spartannash.com

 

MEDIA CONTACT:

Adrienne Chance

SVP, Communications

press@spartannash.com

 

 

SPARTANNASH COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

 

 

12 Weeks Ended

 

 

28 Weeks Ended

 

 

July 13,

 

 

July 15,

 

 

July 13,

 

 

July 15,

 

(In thousands, except per share amounts)

2024

 

 

2023

 

 

2024

 

 

2023

 

Net sales

$

 

2,230,756

 

 

$

 

2,312,394

 

 

$

 

5,037,019

 

 

$

 

5,219,788

 

Cost of sales

 

 

1,877,753

 

 

 

 

1,960,012

 

 

 

 

4,243,672

 

 

 

 

4,420,740

 

Gross profit

 

 

353,003

 

 

 

 

352,382

 

 

 

 

793,347

 

 

 

 

799,048

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

318,157

 

 

 

 

318,795

 

 

 

 

721,790

 

 

 

 

736,991

 

Acquisition and integration, net

 

 

2,613

 

 

 

 

55

 

 

 

 

2,940

 

 

 

 

129

 

Restructuring and asset impairment, net

 

 

6,107

 

 

 

 

(2,254

)

 

 

 

11,875

 

 

 

 

1,829

 

Total operating expenses

 

 

326,877

 

 

 

 

316,596

 

 

 

 

736,605

 

 

 

 

738,949

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating earnings

 

 

26,126

 

 

 

 

35,786

 

 

 

 

56,742

 

 

 

 

60,099

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other expenses and (income)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

10,541

 

 

 

 

9,349

 

 

 

 

24,028

 

 

 

 

20,938

 

Other, net

 

 

(550

)

 

 

 

(685

)

 

 

 

(1,598

)

 

 

 

(1,724

)

Total other expenses, net

 

 

9,991

 

 

 

 

8,664

 

 

 

 

22,430

 

 

 

 

19,214

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings before income taxes

 

 

16,135

 

 

 

 

27,122

 

 

 

 

34,312

 

 

 

 

40,885

 

Income tax expense

 

 

4,646

 

 

 

 

7,654

 

 

 

 

9,852

 

 

 

 

10,080

 

Net earnings

$

 

11,489

 

 

$

 

19,468

 

 

$

 

24,460

 

 

$

 

30,805

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings per basic common share

$

 

0.34

 

 

$

 

0.57

 

 

$

 

0.72

 

 

$

 

0.90

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings per diluted common share

$

 

0.34

 

 

$

 

0.56

 

 

$

 

0.71

 

 

$

 

0.88

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

33,726

 

 

 

 

34,125

 

 

 

 

33,962

 

 

 

 

34,366

 

Diluted

 

 

33,958

 

 

 

 

34,641

 

 

 

 

34,329

 

 

 

 

35,116

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SPARTANNASH COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

 

July 13,

 

 

December 30,

 

(In thousands)

2024

 

 

2023

 

Assets

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

Cash and cash equivalents

$

 

25,242

 

 

$

 

17,964

 

Accounts and notes receivable, net

 

 

426,869

 

 

 

 

421,859

 

Inventories, net

 

 

527,595

 

 

 

 

575,226

 

Prepaid expenses and other current assets

 

 

65,126

 

 

 

 

62,440

 

Total current assets

 

 

1,044,832

 

 

 

 

1,077,489

 

 

 

 

 

 

 

 

 

Property and equipment, net

 

 

662,501

 

 

 

 

649,071

 

Goodwill

 

 

190,214

 

 

 

 

182,160

 

Intangible assets, net

 

 

102,793

 

 

 

 

101,535

 

Operating lease assets

 

 

266,221

 

 

 

 

242,146

 

Other assets, net

 

 

99,323

 

 

 

 

103,174

 

 

 

 

 

 

 

 

 

Total assets

$

 

2,365,884

 

 

$

 

2,355,575

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

Accounts payable

$

 

466,830

 

 

$

 

473,419

 

Accrued payroll and benefits

 

 

60,720

 

 

 

 

78,076

 

Other accrued expenses

 

 

63,557

 

 

 

 

57,609

 

Current portion of operating lease liabilities

 

 

42,394

 

 

 

 

41,979

 

Current portion of long-term debt and finance lease liabilities

 

 

9,754

 

 

 

 

8,813

 

Total current liabilities

 

 

643,255

 

 

 

 

659,896

 

 

 

 

 

 

 

 

 

Long-term liabilities

 

 

 

 

 

 

 

Deferred income taxes

 

 

81,114

 

 

 

 

73,904

 

Operating lease liabilities

 

 

252,850

 

 

 

 

226,118

 

Other long-term liabilities

 

 

25,897

 

 

 

 

28,808

 

Long-term debt and finance lease liabilities

 

 

586,427

 

 

 

 

588,667

 

Total long-term liabilities

 

 

946,288

 

 

 

 

917,497

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders’ equity

 

 

 

 

 

 

 

Common stock, voting, no par value; 100,000 shares
     authorized; 33,750 and 34,610 shares outstanding

 

 

449,076

 

 

 

 

460,299

 

Preferred stock, no par value, 10,000 shares
     authorized; no shares outstanding

 

 

—

 

 

 

 

—

 

Accumulated other comprehensive income

 

 

1,005

 

 

 

 

796

 

Retained earnings

 

 

326,260

 

 

 

 

317,087

 

Total shareholders’ equity

 

 

776,341

 

 

 

 

778,182

 

 

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

$

 

2,365,884

 

 

$

 

2,355,575

 

 

 

 

 

 

 

 

 

 

 

 

 

SPARTANNASH COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

 

 

28 Weeks Ended

 

(In thousands)

 

 

 

July 13, 2024

 

 

July 15, 2023

 

Cash flow activities

 

 

 

 

 

 

 

 

 

 

Net cash provided by operating activities

 

 

 

$

 

132,098

 

 

$

 

49,656

 

Net cash used in investing activities

 

 

 

 

 

(79,495

)

 

 

 

(57,057

)

Net cash used in financing activities

 

 

 

 

 

(45,325

)

 

 

 

(4,775

)

Net increase (decrease) in cash and cash equivalents

 

 

 

 

 

7,278

 

 

 

 

(12,176

)

Cash and cash equivalents at beginning of the period

 

 

 

 

 

17,964

 

 

 

 

29,086

 

Cash and cash equivalents at end of the period

 

 

 

$

 

25,242

 

 

$

 

16,910

 

 

SPARTANNASH COMPANY AND SUBSIDIARIES

SUPPLEMENTAL FINANCIAL DATA

 

 

Table 1: Sales and Operating Earnings (Loss) by Segment

(Unaudited)

 

 

12 Weeks Ended

 

 

28 Weeks Ended

 

(In thousands)

July 13, 2024

 

 

July 15, 2023

 

 

July 13, 2024

 

 

July 15, 2023

 

Wholesale Segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

 

1,554,628

 

 

69.7

%

 

$

 

1,633,364

 

 

70.6

%

 

$

 

3,568,649

 

 

70.8

%

 

$

 

3,719,048

 

 

71.2

%

Operating earnings

 

 

22,067

 

 

 

 

 

 

21,542

 

 

 

 

 

 

58,069

 

 

 

 

 

 

47,867

 

 

 

Retail Segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

 

676,128

 

 

30.3

%

 

 

 

679,030

 

 

29.4

%

 

 

 

1,468,370

 

 

29.2

%

 

 

 

1,500,740

 

 

28.8

%

Operating earnings (loss)

 

 

4,059

 

 

 

 

 

 

14,244

 

 

 

 

 

 

(1,327

)

 

 

 

 

 

12,232

 

 

 

Total:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

 

2,230,756

 

 

100.0

%

 

$

 

2,312,394

 

 

100.0

%

 

$

 

5,037,019

 

 

100.0

%

 

$

 

5,219,788

 

 

100.0

%

Operating earnings

 

 

26,126

 

 

 

 

 

 

35,786

 

 

 

 

 

 

56,742

 

 

 

 

 

 

60,099

 

 

 

 

Non-GAAP Financial Measures

 

In addition to reporting financial results in accordance with GAAP, the Company also provides information regarding adjusted earnings from continuing operations, as well as per diluted share (“adjusted EPS”), net long-term debt, capital expenditures and IT capital, and adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”). These are non-GAAP financial measures, as defined below, and are used by management to allocate resources, assess performance against its peers and evaluate overall performance. The Company believes these measures provide useful information for both management and its investors. The Company believes these non-GAAP measures are useful to investors because they provide additional understanding of the trends and special circumstances that affect its business. These measures provide useful supplemental information that helps investors to establish a basis for expected performance and the ability to evaluate actual results against that expectation. The measures, when considered in connection with GAAP results, can be used to assess the overall performance of the Company as well as assess the Company’s performance against its peers. These measures are also used as a basis for certain compensation programs sponsored by the Company. In addition, securities analysts, fund managers and other shareholders and stakeholders that communicate with the Company request its financial results in these adjusted formats.

Current year adjusted earnings from continuing operations, and adjusted EBITDA exclude, among other items, LIFO expense, organizational realignment, severance associated with cost reduction initiatives and operating and non-operating costs associated with the postretirement plan amendment and settlement. Current year organizational realignment includes consulting and severance costs associated with the Company’s change in its go-to-market strategy as part of its long-term plan, which relates to the reorganization of certain functions. Costs related to the postretirement plan amendment and settlement include operating and non-operating expenses associated with amortization of the prior service credit related to the amendment of the retiree medical plan, which are adjusted out of adjusted earnings from continuing operations. Postretirement plan amendment and settlement costs also include operating expenses related to payroll taxes which are adjusted out of all non-GAAP financial measures. Prior year adjusted earnings from continuing operations, and adjusted EBITDA exclude, among other items, LIFO expense, organizational realignment, severance associated with cost reduction initiatives and a non-routine settlement related to a legal matter resulting from a previously closed operation that was resolved during the prior year and operating and non-operating costs associated with the postretirement plan amendment and settlement.

 

 

Each of these items are considered “non-operational” or “non-core” in nature.

 

The Company is unable to provide a full reconciliation of the GAAP to non-GAAP measures used in the Fiscal 2024 Outlook section of this press release without unreasonable effort because it is not possible to predict certain adjustment items with a reasonable degree of certainty since they are not yet known or quantifiable, and do not relate to the Company's normal operating activities. These adjustments may include, among other items, restructuring and asset impairment activity, acquisition and integration costs, severance, costs related to the postretirement plan amendment and settlement, and organizational realignment costs, and the impact of adjustments to the LIFO inventory reserve. This information is dependent upon future events, which may be outside of the Company's control and could have a significant impact on its GAAP financial results for fiscal 2024.

 

 

Table 2: Reconciliation of Net Earnings to Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization

(Adjusted EBITDA)

(A Non-GAAP Financial Measure)

(Unaudited)

 

 

12 Weeks Ended

 

 

28 Weeks Ended

 

(In thousands)

July 13, 2024

 

 

July 15, 2023

 

 

July 13, 2024

 

 

July 15, 2023

 

Net earnings

$

 

11,489

 

 

$

 

19,468

 

 

$

 

24,460

 

 

$

 

30,805

 

Income tax expense

 

 

4,646

 

 

 

 

7,654

 

 

 

 

9,852

 

 

 

 

10,080

 

Other expenses, net

 

 

9,991

 

 

 

 

8,664

 

 

 

 

22,430

 

 

 

 

19,214

 

Operating earnings

 

 

26,126

 

 

 

 

35,786

 

 

 

 

56,742

 

 

 

 

60,099

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIFO expense

 

 

1,509

 

 

 

 

4,667

 

 

 

 

3,529

 

 

 

 

15,839

 

Depreciation and amortization

 

 

23,342

 

 

 

 

22,458

 

 

 

 

53,988

 

 

 

 

52,203

 

Acquisition and integration, net

 

 

2,613

 

 

 

 

55

 

 

 

 

2,940

 

 

 

 

129

 

Restructuring and asset impairment, net

 

 

6,107

 

 

 

 

(2,254

)

 

 

 

11,875

 

 

 

 

1,829

 

Cloud computing amortization

 

 

1,840

 

 

 

 

1,076

 

 

 

 

3,858

 

 

 

 

2,426

 

Organizational realignment, net

 

 

1,369

 

 

 

 

2,029

 

 

 

 

1,675

 

 

 

 

2,029

 

Severance associated with cost reduction initiatives

 

 

72

 

 

 

 

(12

)

 

 

 

141

 

 

 

 

272

 

Stock-based compensation

 

 

1,900

 

 

 

 

2,465

 

 

 

 

5,620

 

 

 

 

7,612

 

Stock warrant

 

 

190

 

 

 

 

353

 

 

 

 

516

 

 

 

 

960

 

Non-cash rent

 

 

(725

)

 

 

 

(635

)

 

 

 

(1,626

)

 

 

 

(1,563

)

Loss on disposal of assets

 

 

64

 

 

 

 

24

 

 

 

 

44

 

 

 

 

46

 

Legal settlement

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

900

 

Postretirement plan amendment and settlement

 

 

99

 

 

 

 

94

 

 

 

 

99

 

 

 

 

94

 

Adjusted EBITDA

$

 

64,506

 

 

$

 

66,106

 

 

$

 

139,401

 

 

$

 

142,875

 

Wholesale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating earnings

$

 

22,067

 

 

$

 

21,542

 

 

$

 

58,069

 

 

$

 

47,867

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIFO expense

 

 

1,153

 

 

 

 

3,590

 

 

 

 

2,708

 

 

 

 

12,323

 

Depreciation and amortization

 

 

12,301

 

 

 

 

11,644

 

 

 

 

28,379

 

 

 

 

27,014

 

Acquisition and integration, net

 

 

1,977

 

 

 

 

55

 

 

 

 

1,977

 

 

 

 

124

 

Restructuring and asset impairment, net

 

 

118

 

 

 

 

1

 

 

 

 

(32

)

 

 

 

981

 

Cloud computing amortization

 

 

1,155

 

 

 

 

725

 

 

 

 

2,524

 

 

 

 

1,665

 

Organizational realignment, net

 

 

855

 

 

 

 

1,266

 

 

 

 

1,046

 

 

 

 

1,266

 

Severance associated with cost reduction initiatives

 

 

30

 

 

 

 

(7

)

 

 

 

99

 

 

 

 

257

 

Stock-based compensation

 

 

1,357

 

 

 

 

1,611

 

 

 

 

3,861

 

 

 

 

4,994

 

Stock warrant

 

 

190

 

 

 

 

353

 

 

 

 

516

 

 

 

 

960

 

Non-cash rent

 

 

(243

)

 

 

 

(63

)

 

 

 

(543

)

 

 

 

(138

)

Gain on disposal of assets

 

 

(1

)

 

 

 

(45

)

 

 

 

(19

)

 

 

 

(35

)

Legal settlement

 

 

—

 

 

 

 

—

 

 

 

 

—

 

 

 

 

900

 

Postretirement plan amendment and settlement

 

 

62

 

 

 

 

59

 

 

 

 

62

 

 

 

 

59

 

Adjusted EBITDA

$

 

41,021

 

 

$

 

40,731

 

 

$

 

98,647

 

 

$

 

98,237

 

Retail:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating earnings (loss)

$

 

4,059

 

 

$

 

14,244

 

 

$

 

(1,327

)

 

$

 

12,232

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIFO expense

 

 

356

 

 

 

 

1,077

 

 

 

 

821

 

 

 

 

3,516

 

Depreciation and amortization

 

 

11,041

 

 

 

 

10,814

 

 

 

 

25,609

 

 

 

 

25,189

 

Acquisition and integration, net

 

 

636

 

 

 

 

—

 

 

 

 

963

 

 

 

 

5

 

Restructuring and asset impairment, net

 

 

5,989

 

 

 

 

(2,255

)

 

 

 

11,907

 

 

 

 

848

 

Cloud computing amortization

 

 

685

 

 

 

 

351

 

 

 

 

1,334

 

 

 

 

761

 

Organizational realignment, net

 

 

514

 

 

 

 

763

 

 

 

 

629

 

 

 

 

763

 

Severance associated with cost reduction initiatives

 

 

42

 

 

 

 

(5

)

 

 

 

42

 

 

 

 

15

 

Stock-based compensation

 

 

543

 

 

 

 

854

 

 

 

 

1,759

 

 

 

 

2,618

 

Non-cash rent

 

 

(482

)

 

 

 

(572

)

 

 

 

(1,083

)

 

 

 

(1,425

)

Loss on disposal of assets

 

 

65

 

 

 

 

69

 

 

 

 

63

 

 

 

 

81

 

Postretirement plan amendment and settlement

 

 

37

 

 

 

 

35

 

 

 

 

37

 

 

 

 

35

 

Adjusted EBITDA

$

 

23,485

 

 

$

 

25,375

 

 

$

 

40,754

 

 

$

 

44,638

 

 

 

 

Table 2: Reconciliation of Net Earnings to Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization, continued

(Adjusted EBITDA)

(A Non-GAAP Financial Measure)

(Unaudited)

 

 

52 Weeks Ended

 

 

 

 

 

 

 

 

 

 

(In thousands)

2023

 

 

 

 

 

 

 

 

 

 

Net earnings

$

 

52,237

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

 

17,888

 

 

 

 

 

 

 

 

 

 

Other expenses, net

 

 

36,587

 

 

 

 

 

 

 

 

 

 

Operating earnings

 

 

106,712

 

 

 

 

 

 

 

 

 

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

LIFO expense

 

 

16,104

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

98,639

 

 

 

 

 

 

 

 

 

 

Acquisition and integration, net

 

 

3,416

 

 

 

 

 

 

 

 

 

 

Restructuring and asset impairment, net

 

 

9,190

 

 

 

 

 

 

 

 

 

 

Cloud computing amortization

 

 

5,034

 

 

 

 

 

 

 

 

 

 

Organizational realignment, net

 

 

5,239

 

 

 

 

 

 

 

 

 

 

Severance associated with cost reduction initiatives

 

 

318

 

 

 

 

 

 

 

 

 

 

Stock-based compensation

 

 

12,536

 

 

 

 

 

 

 

 

 

 

Stock warrant

 

 

1,559

 

 

 

 

 

 

 

 

 

 

Non-cash rent

 

 

(2,599

)

 

 

 

 

 

 

 

 

 

Loss on disposal of assets

 

 

259

 

 

 

 

 

 

 

 

 

 

Legal settlement

 

 

900

 

 

 

 

 

 

 

 

 

 

Postretirement plan amendment and settlement

 

 

94

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

 

257,401

 

 

 

 

 

 

 

 

 

 

 

Notes: Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“adjusted EBITDA”) is a non-GAAP operating financial measure that the Company defines as net earnings plus interest, discontinued operations, depreciation and amortization, and other non-cash items including share-based payments (equity awards measured in accordance with ASC 718, Stock Compensation, which include both stock-based compensation to employees and stock warrants issued to non-employees) and the LIFO provision, as well as adjustments for items that do not reflect the ongoing operating activities of the Company.

 

Adjusted EBITDA and adjusted EBITDA by segment are not measures of performance under GAAP and should not be considered as a substitute for net earnings, cash flows from operating activities and other income or cash flow statement data. The Company’s definitions of adjusted EBITDA and adjusted EBITDA by segment may not be identical to similarly titled measures reported by other companies.

 

 

 

 

 

Table 3: Reconciliation of Net Earnings to

Adjusted Earnings from Continuing Operations, as well as per diluted share (“adjusted EPS”)

(A Non-GAAP Financial Measure)

(Unaudited)

 

 

12 Weeks Ended

 

 

 

July 13, 2024

 

 

 

July 15, 2023

 

 

 

 

 

 

per diluted

 

 

 

 

 

 

per diluted

 

 

(In thousands, except per share amounts)

Earnings

 

 

share

 

 

 

Earnings

 

 

share

 

 

Net earnings

$

 

11,489

 

 

$

 

0.34

 

 

 

$

 

19,468

 

 

$

 

0.56

 

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIFO expense

 

 

1,509

 

 

 

 

 

 

 

 

 

4,667

 

 

 

 

 

 

Acquisition and integration, net

 

 

2,613

 

 

 

 

 

 

 

 

 

55

 

 

 

 

 

 

Restructuring and asset impairment, net

 

 

6,107

 

 

 

 

 

 

 

 

 

(2,254

)

 

 

 

 

 

Organizational realignment, net

 

 

1,369

 

 

 

 

 

 

 

 

 

2,029

 

 

 

 

 

 

Severance associated with cost reduction initiatives

 

 

72

 

 

 

 

 

 

 

 

 

(12

)

 

 

 

 

 

Postretirement plan amendment and settlement

 

 

(513

)

 

 

 

 

 

 

 

 

(631

)

 

 

 

 

 

Total adjustments

 

 

11,157

 

 

 

 

 

 

 

 

 

3,854

 

 

 

 

 

 

Income tax effect on adjustments (a)

 

 

(2,767

)

 

 

 

 

 

 

 

 

(955

)

 

 

 

 

 

Total adjustments, net of taxes

 

 

8,390

 

 

 

 

0.25

 

 

 

 

 

2,899

 

 

 

 

0.09

 

*

Adjusted earnings from continuing operations

$

 

19,879

 

 

$

 

0.59

 

 

 

$

 

22,367

 

 

$

 

0.65

 

 

* Includes rounding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

28 Weeks Ended

 

 

 

July 13, 2024

 

 

 

July 15, 2023

 

 

 

 

 

 

per diluted

 

 

 

 

 

 

per diluted

 

 

(In thousands, except per share amounts)

Earnings

 

 

share

 

 

 

Earnings

 

 

share

 

 

Net earnings

$

 

24,460

 

 

$

 

0.71

 

 

 

$

 

30,805

 

 

$

 

0.88

 

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIFO expense

 

 

3,529

 

 

 

 

 

 

 

 

 

15,839

 

 

 

 

 

 

Acquisition and integration, net

 

 

2,940

 

 

 

 

 

 

 

 

 

129

 

 

 

 

 

 

Restructuring and asset impairment, net

 

 

11,875

 

 

 

 

 

 

 

 

 

1,829

 

 

 

 

 

 

Organizational realignment, net

 

 

1,675

 

 

 

 

 

 

 

 

 

2,029

 

 

 

 

 

 

Severance associated with cost reduction initiatives

 

 

141

 

 

 

 

 

 

 

 

 

272

 

 

 

 

 

 

Postretirement plan amendment and settlement

 

 

(1,458

)

 

 

 

 

 

 

 

 

(1,649

)

 

 

 

 

 

Legal settlement

 

 

—

 

 

 

 

 

 

 

 

 

900

 

 

 

 

 

 

Total adjustments

 

 

18,702

 

 

 

 

 

 

 

 

 

19,349

 

 

 

 

 

 

Income tax effect on adjustments (a)

 

 

(4,803

)

 

 

 

 

 

 

 

 

(4,925

)

 

 

 

 

 

Total adjustments, net of taxes

 

 

13,899

 

 

 

 

0.41

 

*

 

 

 

14,424

 

 

 

 

0.41

 

 

Adjusted earnings from continuing operations

$

 

38,359

 

 

$

 

1.12

 

 

 

$

 

45,229

 

 

$

 

1.29

 

 

* Includes rounding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(a)
The income tax effect on adjustments is computed by applying the effective tax rate, before discrete tax items, to the total adjustments for the period.

 

 

 

 

52 Weeks Ended

 

 

 

December 30, 2023

 

 

 

 

 

 

per diluted

 

 

(In thousands, except per share data)

Earnings

 

 

share

 

 

Net earnings

$

 

52,237

 

 

$

 

1.50

 

 

Adjustments:

 

 

 

 

 

 

 

 

LIFO expense

 

 

16,104

 

 

 

 

 

 

Acquisition and integration, net

 

 

3,416

 

 

 

 

 

 

Restructuring and asset impairment, net

 

 

9,190

 

 

 

 

 

 

Organizational realignment, net

 

 

5,239

 

 

 

 

 

 

Severance associated with cost reduction initiatives

 

 

318

 

 

 

 

 

 

Legal settlement

 

 

900

 

 

 

 

 

 

Postretirement plan amendment and settlement

 

 

(3,174

)

 

 

 

 

 

Total adjustments

 

 

31,993

 

 

 

 

 

 

Income tax effect on adjustments (a)

 

 

(8,218

)

 

 

 

 

 

Total adjustments, net of taxes

 

 

23,775

 

 

 

 

0.68

 

 

Adjusted earnings from continuing operations

$

 

76,012

 

 

$

 

2.18

 

 

 

(a)
The income tax effect on adjustments is computed by applying the effective tax rate, before discrete tax items, to the total adjustments for the period.

 

Notes: Adjusted earnings from continuing operations, as well as per diluted share (“adjusted EPS”), is a non-GAAP operating financial measure that the Company defines as net earnings plus or minus adjustments for items that do not reflect the ongoing operating activities of the Company and costs associated with the closing of operational locations.

Adjusted earnings from continuing operations is not a measure of performance under GAAP and should not be considered as a substitute for net earnings, cash flows from operating activities and other income or cash flow statement data. The Company’s definition of adjusted earnings from continuing operations may not be identical to similarly titled measures reported by other companies.

 

Table 4: Reconciliation of Long-Term Debt and Finance Lease Obligations to Net Long-Term Debt

(A Non-GAAP Financial Measure)

(Unaudited)

(In thousands)

July 13, 2024

 

 

December 30, 2023

 

Current portion of long-term debt and finance lease liabilities

$

 

9,754

 

 

$

 

8,813

 

Long-term debt and finance lease liabilities

 

 

586,427

 

 

 

 

588,667

 

Total debt

 

 

596,181

 

 

 

 

597,480

 

Cash and cash equivalents

 

 

(25,242

)

 

 

 

(17,964

)

Net long-term debt

$

 

570,939

 

 

$

 

579,516

 

 

Notes: Net long-term debt is a non-GAAP financial measure that is defined as long-term debt and finance lease obligations plus current maturities of long-term debt and finance lease obligations less cash and cash equivalents. The Company believes both management and its investors find the information useful because it reflects the amount of long-term debt obligations that are not covered by available cash and temporary investments. Net long-term debt is not a substitute for GAAP financial measures and may differ from similarly titled measures of other companies.

Table 5: Reconciliation of Purchases of Property and Equipment to Capital Expenditures and IT Capital

(A Non-GAAP Financial Measure)

(Unaudited)

 

 

 

 

 

28 Weeks Ended

 

(In thousands)

 

 

 

July 13, 2024

 

 

July 15, 2023

 

Purchases of property and equipment

 

 

 

$

 

67,074

 

 

$

 

60,824

 

Plus:

 

 

 

 

 

 

 

 

 

 

Cloud computing spend

 

 

 

 

 

6,347

 

 

 

 

2,719

 

Capital expenditures and IT capital

 

 

 

$

 

73,421

 

 

$

 

63,543

 

 

 

 

 

 

 

 

52 Weeks Ended

 

 

 

 

(In thousands)

 

 

 

December 30, 2023

 

 

 

Purchases of property and equipment

 

 

 

$

 

120,330

 

 

 

 

Plus:

 

 

 

 

 

 

 

 

 

Cloud computing spend

 

 

 

 

 

7,040

 

 

 

 

Capital expenditures and IT capital

 

 

 

$

 

127,370

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Notes: Capital expenditures and IT capital is a non-GAAP financial measure calculated by adding spending related to the development of cloud computing applications to capital expenditures, the most directly comparable GAAP measure. Cloud computing spend only includes costs incurred during the application development phase and does not include ongoing costs of hosting or maintenance associated with these applications, which are expensed as incurred. The Company believes it is a useful indicator of the Company’s investment in its facilities and systems as it transitions to more cloud-based IT systems. Capital expenditures and IT capital is not a substitute for GAAP financial measures and may differ from similarly titled measures of other companies.